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2016 (3) TMI 496 - ITAT AHMEDABADPenalty u/s 271C - non deduction of tds u/s 194LA - Held that:- The assessee had paid compensation to the land owners but has not deducted the tax u/s 194LA of the Act from such payments as the assessee was under bona fide belief that he was not under any obligation to deduct the tax u/s 194LA of the Act. The omission on the part of the assessee was inadvertent and there was no mala fide intention. For non-deduction of TDS and delay in filing the TDS, the assessee had paid interest of ₹ 33,480/- and also paid interest of ₹ 54,923/- determined to be payable u/s 201(1A) of the Act by ITO(TDS), Valsad. Thus, there is no loss to the Revenue. Therefore, there is no mala fide intention on assessee’s part, in 1st lapse on its part, as it seems that there is no loss to the Revenue. See CIT vs. Cadbury India Limited [2011 (3) TMI 239 - DELHI HIGH COURT ] wherein the Hon’ble High Court held that “penalty u/s 271C for non-deduction of TDS not leviable if there was no “mala fide intention” or “deliberate defiance” of law”. It was also observed by the Hon’ble Delhi High Court in the aforesaid judgment that the levy of penalty u/s 271C is not automatic. Therefore, in the present case, there was no mala fide intention on the part of the assessee for non-deduction of TDS since it had recovered the TDS from the concerned as soon as the violation of law was brought into assessee’s notice, as discussed above. - Decided in favour of assessee
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